Beware of Greeks

Tuesday, November 1st, 2011

Greece prime minister Papandreou announces a referendum over the anti-bankruptcy aid package for his country announced at last week’s EU summit – and all hell breaks loose on world markets!


Yes, every other newspaper is writing about this as well, but this particular Die Welt article, by D. Eckert and H. Zschäpitz, stands out for its headline: Papandreou risks a global financial meltdown, or rather the alarm such a headline evokes in contrast to the serious, mainstream sort of paper we all know Die Welt to be – i.e one that doesn’t usually resort to such headlines. Yes, there are no doubt similar-sounding titles in tabloid papers, and not just in Germany, but all that is mere dog-bites-man.

This piece also stands out for the handy list it provides – you have to scroll down a little, look for Die größten Wertverluste . . . – of the banks which have lost the most market-capitalization, so far, from the plummeting prices of their shares. FYI, BNP Paribas stands at the top, with nearly €4.7 billion lost, followed by Deutsche Bank. (It also stands out for author “H. Zschäpitz”: isn’t that just a howler of a name? But no doubt the fellow has a Google Alert on it and will be reading this blogpost sooner or later – my apologies!)

Otherwise, though, I stand vulnerable to the charge of European tokenism. Because the piece that has really clarified things for me is in English, and written by our old friend Dana Blankenhorn. Greek Latest is Solar Scam is its title, it does spend a few paragraphs dissecting the faulty economics behind a Greek solar-energy investment plan. But then it addresses what Papandreou and the Greek authorities are really trying to do with this referendum. Given that Blankenhorn assumes that the result will be “No,” it’s simple: they are threatening to take the rest of Europe to down with them, unless they get an even-better debt-relief deal than the 50% they got from the EU last week.

You should check it out, and the article from Seeking Alpha that Blankenhorn links to as well. Strangely, his link to it reads “Sink the euro” even though that other article itself argues that there is still a chance for a “Yes” vote!

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